East African Community finance ministers face a tough task this week (Thursday) as they present their budget statements for the 2019/2020 fiscal year with a focus on bringing more people and businesses into the tax bracket to service the rising public debt and reverse the fall in revenue collections.

The ministers will also be looking to allocate the additional resources to the debt-servicing kitty through the Consolidated Fund Services.

EAC partner states are considering ways of widening tax brackets to boost revenue collections and channel more domestic resources towards repayments of interest on billions of dollars’ worth of loans procured to fund development projects.

The EAC has been trapped in the web of infrastructure development which has seen millions of dollars find their way into various projects such as pipeline, road, rail, airports, and ports development.

It is, however, argued that while infrastructure development is important to the economic development of a nation, funding for these projects is nudging the national economies into a debt overhang, with most of the expensive loans coming from China in exchange for project contracts.

DAR ES SALAAM

Source The EastAfrican

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